OMNI HOTELS BUYS LA COSTA RESORT

Purchase part of an acquisition of 4 other hotels across nation

Three years after being sold to a private equity firm, La Costa Resort and Spa is being sold yet again, this time to Omni Hotels, which will put its brand on the luxury property July 1.

The high-profile sale is part of a larger acquisition that includes four other high-end resorts across the country. The only other California property included in the Omni Hotels and Resorts acquisition is Rancho Las Palmas Resort & Spa in Rancho Mirage.

Selling the resorts is KSL Capital Partners, which in 2010 took over ownership of La Costa after purchasing $380 million in debt from the lender for roughly $120 million. The Denver-based private equity firm later invested $50 million in a renovation of the more than 400-acre property that included a redo of 611 guest rooms, the addition of an adults-only pool, and terraced, waterfall-adorned areas for business mixers and weddings. In addition, the former North golf course, now known as the Champions Course, was modernized, and the resort’s second 18-hole golf course is currently undergoing a renovation. It will reopen as the Legends Course this fall.

Omni, which announced the transaction Wednesday, would not disclose the purchase price for the properties. The Wall Street Journal, citing a person familiar with the deal, said it was roughly $900 million.

In all, the five resorts will add 2,362 rooms, 304,000 square feet of meeting space, 34 dining venues, 12 golf courses, three water parks, a ski facility and five spas to Omni’s 51-hotel portfolio. The other hotels acquired by Omni are the Barton Creek Resort & Spa in Austin, The Grove Park Inn in Asheville, N.C.; and The Homestead in Hot Springs, Va.

Its acquisition is part of an ambitious expansion for Omni, which earlier this year purchased a 564-room Westin Hotel in Providence, R.I. It also has four hotels under development, including the 800-room Omni Nashville, which will open in September.

“When we originally started conversations with KSL, we initially were looking at the Barton Creek Resort, and then we started looking at some of the other resorts in their portfolio and there were a couple that were very attractive to us, La Costa specifically,” said Anne Tramer, Omni’s vice president of corporate communications. “Omni likes to operate celebrated resorts that are historic, where they offer a very authentic local experience, and we’re an upscale luxury hotel brand. So La Costa fit right into our resort portfolio.”

The only other Omni hotel in San Diego County is in downtown San Diego near Petco Park.

Omni’s purchase also made financial sense because of the paucity of new hotels and resorts that are being built, Tramer said. She noted that supply in the hospitality sector is at a record low.

KSL representatives declined to comment on the sale, but La Costa General Manager Paul McCormick offered the following statement: “Our resort is a long-standing classic hotel in North America that is distinguished in design, local color and authenticity that reflects our destination. Omni’s hotels and resorts provide this same type of authentic local flavor in their individual markets.”